Why Alibaba And Other Stocks Are Plunging In Hong Kong Today

Shares of U.S.-listed Chinese tech companies — Alibaba Group Holdings Ltd. (NYSE: BABA), JD.Com Inc. (NASDAQ: JD), Tencent Holdings (OTC: TCEHY), and Baidu Inc. (NASDAQ: BIDU)— slumped in early trading in Hong Kong on Thursday (local time).

Macro Factors: Amid weak cues from global markets, the overall Hang Seng Index was trading in red at 10:52 a.m. Hong Kong time.

The U.S. indices fell on Wednesday, and the dollar surged to a nearly two-year peak after the Fed released minutes from its last meeting that reinforced views that the central bank may tighten aggressively to curb inflation.

Meanwhile, Being Co. (NYSE: BA) is set to appoint a former police officer and top security official as the next leader of Hong Kong, underlining Beijing’s continued emphasis on security in the Special Administrative Region despite mounting economic challenges.

With the rising COVID-19 cases in Shanghai, Hong Kong is back to banning flights at a much faster rate than since January, according to a Bloomberg report. The six airlines’ bans occurred within four days — Singapore Airlines Ltd., Emirates, Cathay Pacific Airways Ltd., Qatar Airways, and Korean Air Lines — are among the banned airlines.

The Individual Factors:

• Citigroup slashed the price target for Alibaba stock by 12% over COVID-19 concerns but kept its Buy rating.
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